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M o U d o w n ; A R P M i n c r e a s e s …
Bharti Airtel declared its Q3FY12 numbers, which were slightly better than
our topline estimates but below our estimates on the PAT front. The
company reported a topline of | 18476.7 crore against our expectation of
| 18294.0 crore, registering QoQ growth of 7.0%. The EBITDA margin,
however, declined 155 bps QoQ due to higher marketing costs and higher
access charges. EBITDA for the quarter stood at | 5927.3 crore against
our expectation of | 6111.0 crore. The PAT for the company stood at
| 1011.3 crore as against our expectation of | 1374.6 crore, de-growing
1.5% QoQ marred by higher depreciation cost and higher tax rate. The
depreciation for the quarter stood at | 3584.5 crore against | 3183.9 crore
in Q2FY12 as it included 3G license fee amortisation of | 164 crore. The
tax rate increased from 32.4% in Q2FY12 to 35.2% in Q3FY12.
Highlights of the quarter
ARPU for India stood at | 187, up from | 183, improving 2.2% QoQ. MoU,
however, saw a decline of 1.0% from | 423 in Q2FY12 to | 419 in Q3FY12.
ARPM surprised positively by improving by 3.2% to 44.6 paisa from 43.2
paisa while the traffic increased from 217.4 billion minutes to 219.1 billion
minutes. The Indian subscriber base grew by 1.7% sequentially to 175.7
million. ARPU for the African operations decreased 2.3% to $7.1 while the
subscriber base grew by 5.2% to 50.9 million.
V a l u a t i o n
Though the MoU reduced in the quarter responding to the recent price
hike, ARPM and ARPU improved. The SC ruling of cancelling 122 licenses
is very favourable to Bharti Airtel. We expect the company to post
revenue and PAT CAGR of 17.1% and 15.6% over FY11-13E, respectively.
At the CMP of | 350, the stock is trading at 26.8x FY12E and 16.5x FY13E.
Using DCF methodology and assuming revenue CAGR of 10.8% over
FY11–20E and terminal growth of 3.0% thereon, we have arrived at a
target price of | 450/share. We reiterate our BUY rating on Bharti Airtel.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
PDF LINK for report- click HERE
M o U d o w n ; A R P M i n c r e a s e s …
Bharti Airtel declared its Q3FY12 numbers, which were slightly better than
our topline estimates but below our estimates on the PAT front. The
company reported a topline of | 18476.7 crore against our expectation of
| 18294.0 crore, registering QoQ growth of 7.0%. The EBITDA margin,
however, declined 155 bps QoQ due to higher marketing costs and higher
access charges. EBITDA for the quarter stood at | 5927.3 crore against
our expectation of | 6111.0 crore. The PAT for the company stood at
| 1011.3 crore as against our expectation of | 1374.6 crore, de-growing
1.5% QoQ marred by higher depreciation cost and higher tax rate. The
depreciation for the quarter stood at | 3584.5 crore against | 3183.9 crore
in Q2FY12 as it included 3G license fee amortisation of | 164 crore. The
tax rate increased from 32.4% in Q2FY12 to 35.2% in Q3FY12.
Highlights of the quarter
ARPU for India stood at | 187, up from | 183, improving 2.2% QoQ. MoU,
however, saw a decline of 1.0% from | 423 in Q2FY12 to | 419 in Q3FY12.
ARPM surprised positively by improving by 3.2% to 44.6 paisa from 43.2
paisa while the traffic increased from 217.4 billion minutes to 219.1 billion
minutes. The Indian subscriber base grew by 1.7% sequentially to 175.7
million. ARPU for the African operations decreased 2.3% to $7.1 while the
subscriber base grew by 5.2% to 50.9 million.
V a l u a t i o n
Though the MoU reduced in the quarter responding to the recent price
hike, ARPM and ARPU improved. The SC ruling of cancelling 122 licenses
is very favourable to Bharti Airtel. We expect the company to post
revenue and PAT CAGR of 17.1% and 15.6% over FY11-13E, respectively.
At the CMP of | 350, the stock is trading at 26.8x FY12E and 16.5x FY13E.
Using DCF methodology and assuming revenue CAGR of 10.8% over
FY11–20E and terminal growth of 3.0% thereon, we have arrived at a
target price of | 450/share. We reiterate our BUY rating on Bharti Airtel.
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